Nasdaq’s Commitment to Reforming U.S. Capital Markets
U.S. equities markets are a fundamental engine of innovation, economic growth and prosperity. Yet, despite the successes of U.S. markets, there is more that can be done to grow jobs, fuel the economy and create long-term wealth.
Since the launch of our blueprint in 2017, we have seen many positive developments within Congress, federal agencies and the business community at large, including:
- Movement at the SEC and in Congress to enhance transparency and fairness in the proxy advisory industry
- Changes by the SEC to the process for removing repetitive, unsuccessful proposals from proxies
- Growing support from the business community to streamline and allow flexibility in quarterly reporting obligations for small and medium growth companies
- Interest at the SEC in helping smaller public companies by consolidating displayed liquidity onto a single trading venue
- The U.S. Treasury Department’s 2017 Report, "A Financial System That Creates Economic Opportunities - Capital Markets”
Our equities markets are built on timeless, proven principles, but the markets of tomorrow require a new way of thinking.
America's equity markets are truly the best in the world — they attract the deepest and most diverse community of investors and market participants and drive our economy.President and CEO
Revitalizing the Markets: 3 Key Areas
Reform of Regulations
Overly complex regulations are disincentivising market participation. Efforts should be made to free up resources so that companies can focus on innovation, growth and job creation, rather than on red tape and unnecessary distractions.
Nasdaq proposes regulatory solutions that will reform:
- The proxy proposal process to reduce the burden on companies;
- The corporate tax code and structure and;
- The problems of irresponsible litigation.
Modernization of Market Structure
A one-size-fits-all market structure deprives some companies of the benefits they need to participate and succeed in public markets.
Nasdaq supports efforts to:
- Strengthen markets for smaller companies;
- Deploy intelligent minimum price movements for small and medium growth companies and;
- Cultivate innovative solutions that improve the trading of small and medium growth companies.
A culture in the investment community and in the mainstream media has created an imbalance between the value of long-term return and short-term potentials.
Nasdaq supports these changes:
- Increasing the flexibility of reporting obligations;
- Enhancing transparency around activist investing;
- Equalizing short interest transparency and;
- Supporting the dual class structure that is critical to attracting the most innovative and growing companies to participate in public markets.
SEC Amends Certain Financial Disclosure Requirements
The U.S. Securities and Exchange Commission (SEC) has adopted amendments that modify certain financial disclosure requirements about acquisitions and dispositions of businesses.READ
SEC Scales Disclosure Requirements for Certain New and Smaller Issuers
On March 12, the SEC announced it has adopted amendments to the “accelerated filer” and “large accelerated filer” definitions in Exchange Act Rule 12b-2.READ
Nasdaq Comments on 2 SEC Proposals That Will Improve the Proxy Process
On February 3, 2020, Nasdaq submitted two comment letters supporting the U.S. Securities and Exchange Commission’s (SEC) efforts to improve the proxy process.
SEC Proposes Amendments to Rules Governing Proxy Solicitations and Shareholder Proposals
The SEC held an open meeting and formally proposed amendments to improve the accuracy and transparency of proxy voting advice and modernize the shareholder proposal rule.READ
SEC Expands ‘Test-the-Waters’ Accommodation
The SEC has expanded its rules permitting companies to ‘test-the-waters,’ or gauge market interest, by reaching out to certain investors before a registered public offering.
Nasdaq Comments on Two SEC Proposals That Will Reduce Compliance Burdens for Public Companies
On July 29, 2019, Nasdaq submitted two comment letters commending the SEC for considering ways to reduce compliance burdens for public companies while maintaining important investor protections.READ
Advancing Nasdaq’s Revitalize Agenda
There has been progress around many issues outlined in our Revitalize blueprint to address the challenges facing the public markets.READ
SEC Proposes Expansion of "Test-the-Waters" Reform
SEC rule would allow all companies to discuss their IPO plans privately with investors before deciding to go public.
U.S. Companies Demand Regulation of Proxy Advisors (Financial Times - subscription required)
Public companies have pressed the U.S. securities regulator for tighter oversight of proxy advisers.READ
Public Letter Following SEC Proxy Process Roundtable (Harvard Law School Forum on Corp. Governance & Financial Regulation)
Nasdaq and other public companies urge the SEC to address the reform the proxy process.READ
Proxy Advisers Must Embrace Calls for Reform (Financial Times – subscription required)
Services should submit themselves to some external oversight by the SECREAD
More Than 300 Companies Join Nasdaq in SEC Letter
Outlines proxy reform priorities
U.S. House Approves Financial Services Legislation Supported by Nasdaq's Revitalize Initiative
Nasdaq remains committed to working with Congress, the SEC and other constituents to move forward priorities that will help make the public markets more attractive.
Legislative Updates: Improving the Public Company Experience
Nasdaq Stock Exchange President Nelson Griggs shares Nasdaq and legislative developments toward improving the public company experience.READ
After U.S. Dodd-Frank Law Changes, Lobbyists Fight for More (Reuters)
Some business groups hope lawmakers will move quickly to change other financial rules they say are hurting Main Street businessesREAD
U.S. House of Representatives Passes Proxy Advisory Firm Reform Legislation
Nasdaq applauds the House’s passing of H.R. 4015, Corporate Governance Reform and Transparency Act.
Small Companies are Being Regulated Like Large Companies
Small companies being regulated the same way as large companies is "dampening the IPO market," Nasdaq Vice Chairman Bruce Aust told CNBC.
Nasdaq’s Proposal to Improve Market Quality for Thinly-Traded, Small and Medium Sized Companies
On February 5, 2020, Nasdaq submitted a detailed application to the U.S. Securities and Exchange Commission (SEC) to empower Nasdaq-listed thinly-traded securities with the ability to focus their trading to a specific exchange venue to consolidate liquidity.READ
SEC Seeks Proposals to Enhance Trading for Thinly-Traded Securities
The U.S. Securities and Exchange Commission (SEC) is asking market participants to develop innovative proposals for changes in equity market structure that are designed to improve trading in thinly-traded securities.READ
Six Reforms for Greater Market Resilience (Law360/CNBC.com)
Nasdaq's Edward Knight details six reforms that could make our markets more resilient and ensure our financial systems operate at their most efficient.READ
Nasdaq's Proposal to Improve Trading Environment in Small and Medium Growth Companies and Investors
Since the launch of our Revitalize initiative, Nasdaq has continued to advocate for reforms that help reignite America’s economic engine by reforms of market structure and the regulatory framework and reorienting to a long-term view.
A More Concentrated Market Would Help IPOs
It is in America’s best interest that its brightest, most innovative entrepreneurs seek public offerings rather than private exits.READ
Prioritizing Long-Term Growth Over Short-Term Returns
Nasdaq Stock Exchange President Nelson Griggs provides updates outlining the progress of Nasdaq’s efforts to revitalize the capital markets.READ
Commentary: Shining a Light on Shorts Will Improve Market Integrity, Investor Protection (Pensions & Investments)
Congress should enact sensible transparency requirements for short positions to address current gaps in the disclosure framework, root out market abuse and restore confidence in the integrity of our public markets.READ
Nasdaq CEO Discusses Benefit of Dual Class Structure
Nasdaq CEO Adena Friedman joins "Squawk Box" at the World Economic Forum at Davos to discuss IPOs in the pipeline.WATCH
Nasdaq Comment Letter to MSCI regarding Consultation on the Treatment of Unequal Voting
Nasdaq asks MSCI to reconsider its proposal.READ
The Long and Short of Unfair Trade Rules
Nasdaq's Edward Knight pens op-ed on the unfair trade rules for long and short sellers.READ
Nasdaq Sides with Snap on Voting Rights Debate
Nelson Griggs, head of global listings at the Nasdaq Stock Market, said Nasdaq supports companies that want to go public with a dual-class share structure.READ